India cuts customs duty rate for power projects

subscribe

In a bid to accelerate the progress of brownfield projects and improve the equipment supply chain, the finance ministry of India has announced that the basic customs duty concession that is applicable on equipment imported for greenfield power projects will now be extended to expansion or brownfield projects as well.

The notification says that the existing customs duty of 17% on brownfield expansion of mega-power projects will be reduced to 2.5%.

Mega-power projects are those that have a generation capacity of 700 megawatts (MW) or more. Regardless of any capacity thresholds that existed under the earlier rules, all expansion projects of mega-power plants will now be eligible for the same benefits available to greenfield projects under the Mega-Power Policy.

Some of the companies that will benefit from this notification are India's largest power generating company, state-run NTPC Limited, and private players such as GMR Infrastructure Limited, GVK Power and Infrastructure Limited, Reliance Power Limited, and integrated power utility company Tata Power Company Limited.

Under the ongoing 11th Five-Year Plan period, 2007-12, India's power capacity augmentation target is 78,700 MW and the likely target for the 12th Five-Year Plan period, 2012-17, is about 80,000 MW. The revised custom duty rate would benefit all projects that are part of the two plans. The cabinet had cleared the revised Mega-Power Policy in October and was awaiting notification from the finance ministry.

According to a senior official from the power ministry, the revised policy is to promote technology transfer and support indigenous manufacture of supercritical power equipment. The policy is applicable to hydropower and thermal (coal, nuclear, lignite, and gas) power projects, and is being extended to supercritical projects with a generation capacity of 660 MW and more.

A mandatory condition is that an indigenous manufacturing facility must be set up after meeting the eligibility criteria.

Related News

electricity meter

During this Pandemic, Save Money - How To Better Understand Your Electricity Bill

NEW YORK - Especially during these tough economic times, facility executives who don’t understand how their power is priced have been disappointed when their energy projects failed to produce expected dollar savings. Here’s how not to be one of them.

Your electric rate is spelled out in a document called a “tariff” that can be downloaded from your utility’s web page. A tariff should clearly spell out the costs for each component that is part of your rate. Don’t be surprised to learn that it contains a bunch of them. Unlike residential electric rates, commercial electric bills are not based solely…

READ MORE

California scorns fossil fuel but can't keep the lights on without it

READ MORE

finland wind power

Neste increases the use of wind power at its Finnish production sites to nearly 30%

READ MORE

Electricity users in Newfoundland have started paying for Muskrat Falls

READ MORE

texas power lines

Air Conditioning Related Power Usage Set To Create Power Shortages In Many States

READ MORE